The three-month dollar Libor rate hits 10-year high
The three-month rate for dollar Libor (London Interbank Offered Rate) has jumped to a 10-year high of 2 percent this week, signaling a rise in the short-term US dollar funding cost.
"About $350 trillion of financial products and loans are linked to Libor, with a large chunk hinged to the dollar-based benchmark", according to Bloomberg report. So, a rising Libor could hurt consumers and business in terms of their cost of capital and the cost of their mortgages, especially the ones with floating rate liability.
Further, the Libor could continue rising as the markets price in the possibility of the Fed raising rates three more times this year.
Author
Omkar Godbole
FXStreet Contributor
Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.
